Rights On Demand: Ensuring Workplace Standards and Worker Security in the On-Demand Economy

The organization of work is changing rapidly for America’s workers. While the latter decades of the 20th century witnessed a transformation from the post–World War II paradigm of long-term stable employment with a single employer to an economy in which many individuals expected to move through several jobs over their careers, the 21st century surge in new technologies has upended even those expectations. For millions today and in the future, the hope of attaining career-long security and support through one or more jobs is giving way to the reality of piece-rate work—and piecemeal economic insecurity—often, in one-time, part-time, hours-long, and be-your-own-boss short-term “gigs,” assigned to them by well-capitalized brokers of labor.

The “on-demand” economy is garnering increasing public attention, from partisan sparring on the campaign trail to articles and editorials hailing the opportunities and highlighting the obstacles stemming from this rising sector. But the reality is that for some time, workers and organizers have been pulling back the veil on the on-demand economy, shedding light on online app-based companies that are amassing revenues and profits through the labor of growing numbers of individual workers who provide the services the companies market to others.

In the face of mounting criticism over their treatment of workers, many of these companies have argued that any labor regulation will crush the innovation they have advanced. They say they are not employers, and the individuals whose labor they profit from are not their employees, because they offer only an online platform that workers and consumers use to find each other. This argument, however, ignores the fact that these on-demand companies are actually performing a labor-brokering function that is not new but has been around for decades. At its core, their business is to dispatch workers who provide services to consumers and businesses. The use of online platforms to broker work should not insulate businesses from employer status, nor do the artificial labels these businesses attach to their workers define the employment relationship. Simply put: many individuals working in the on-demand economy are employees, and their employers should treat them as such.

Regardless of how these businesses characterize their relationships with workers, they should not be allowed to shut workers out of what our nation’s baseline labor standards were intended to convey: the opportunity to achieve and sustain economic security through work. The technology used by these companies and others holds enormous potential to benefit both businesses and workers. To ensure that this potential is met, we must enforce our existing labor standards aggressively and adapt them where and as needed, to ensure they deliver essential labor rights to all, protect law-abiding employers, and secure the safety net and tax dollars connected to employment for the good of us all. Those rights and protections should include the following:

Rights on the job: Like other workers, on-demand workers should enjoy the protection of baseline labor standards, including the right to the minimum wage for all hours worked and the right to a voice on the job. The label assigned to a worker by an on-demand company should not determine or defeat their ability to have decent jobs. Workers in app-based jobs also need new protections to guard against the misuse of company-held data.

Social insurance protections: All workers need and deserve the protections afforded by basic social insurance programs. Businesses in the on-demand economy should not get a free pass on making contributions to existing social insurance programs, such as Social Security, Medicare, workers’ compensation, and unemployment insurance, on their workers’ behalf. And the social insurance programs now being developed, such as earned leave and supplemental retirement savings, should extend to on-demand workers.

Broad and equitable access to technology: If the future of work is that we access it via the internet, all workers should have meaningful access to the necessary technologies to secure it.

The on-demand economy covered in this report refers to businesses that use internet-based platforms to assign individuals seeking work to businesses and individuals seeking services, controlling relevant aspects of the work and working conditions. The on-demand economy takes many forms and operates in several key sectors. It includes “ride share” companies such as Uber and Lyft, housekeeping and repair companies such as Handy, computer-based crowdwork companies such as Crowdflower and Amazon’s Mechanical Turk, and online staffing agencies such as Wonolo. While these companies differ in some respects, they are alike in that they shift risks to workers who deliver the services and concentrate wealth in the online business owners who operate them.

The organization of work is changing rapidly for America’s workers. While the latter decades of the 20th century witnessed a transformation from the post–World War II paradigm of long-term stable employment with a single employer to an economy in which many individuals expected to move through several jobs over their careers, the 21st century surge in new technologies has upended even those expectations. For millions today and in the future, the hope of attaining career-long security and support through one or more jobs is giving way to the reality of piece-rate work—and piecemeal economic insecurity—often, in one-time, part-time, hours-long, and be-your-own-boss short-term “gigs,” assigned to them by well-capitalized brokers of labor.

The “on-demand” economy is garnering increasing public attention, from partisan sparring on the campaign trail to articles and editorials hailing the opportunities and highlighting the obstacles stemming from this rising sector. But the reality is that for some time, workers and organizers have been pulling back the veil on the on-demand economy, shedding light on online app-based companies that are amassing revenues and profits through the labor of growing numbers of individual workers who provide the services the companies market to others.

In the face of mounting criticism over their treatment of workers, many of these companies have argued that any labor regulation will crush the innovation they have advanced. They say they are not employers, and the individuals whose labor they profit from are not their employees, because they offer only an online platform that workers and consumers use to find each other. This argument, however, ignores the fact that these on-demand companies are actually performing a labor-brokering function that is not new but has been around for decades. At its core, their business is to dispatch workers who provide services to consumers and businesses. The use of online platforms to broker work should not insulate businesses from employer status, nor do the artificial labels these businesses attach to their workers define the employment relationship. Simply put: many individuals working in the on-demand economy are employees, and their employers should treat them as such.

Regardless of how these businesses characterize their relationships with workers, they should not be allowed to shut workers out of what our nation’s baseline labor standards were intended to convey: the opportunity to achieve and sustain economic security through work. The technology used by these companies and others holds enormous potential to benefit both businesses and workers. To ensure that this potential is met, we must enforce our existing labor standards aggressively and adapt them where and as needed, to ensure they deliver essential labor rights to all, protect law-abiding employers, and secure the safety net and tax dollars connected to employment for the good of us all. Those rights and protections should include the following:

Rights on the job: Like other workers, on-demand workers should enjoy the protection of baseline labor standards, including the right to the minimum wage for all hours worked and the right to a voice on the job. The label assigned to a worker by an on-demand company should not determine or defeat their ability to have decent jobs. Workers in app-based jobs also need new protections to guard against the misuse of company-held data.

Social insurance protections: All workers need and deserve the protections afforded by basic social insurance programs. Businesses in the on-demand economy should not get a free pass on making contributions to existing social insurance programs, such as Social Security, Medicare, workers’ compensation, and unemployment insurance, on their workers’ behalf. And the social insurance programs now being developed, such as earned leave and supplemental retirement savings, should extend to on-demand workers.

Broad and equitable access to technology: If the future of work is that we access it via the internet, all workers should have meaningful access to the necessary technologies to secure it.

The on-demand economy covered in this report refers to businesses that use internet-based platforms to assign individuals seeking work to businesses and individuals seeking services, controlling relevant aspects of the work and working conditions. The on-demand economy takes many forms and operates in several key sectors. It includes “ride share” companies such as Uber and Lyft, housekeeping and repair companies such as Handy, computer-based crowdwork companies such as Crowdflower and Amazon’s Mechanical Turk, and online staffing agencies such as Wonolo. While these companies differ in some respects, they are alike in that they shift risks to workers who deliver the services and concentrate wealth in the online business owners who operate them.